Exploring HECM counselors’ fraud awareness and training
Abstract
Purpose
The purpose of this research was to explore the growth of Home Equity Conversion Mortgage (HECM) fraud and the role of housing counselors in its identification and prevention. HECMs are the Federal Housing Administration endorsed version of a reverse mortgage and represent the majority of reverse mortgages on the market.
Design/methodology/approach
To investigate HECM counselor’s training, and their ability to detect fraudulent activity, a survey was constructed and distributed nationwide using HUD’s publicly available roster of qualified agencies and counselors. The survey consisted of three main sections agency and respondent information including HECM certification process, typical interactions with clients, and mortgage fraud and HECM fraud.
Findings
Responses indicate that HECM counselors have limited awareness of and training in identifying fraudulent activities.
Originality/value
The case is made that additional training is needed to raise awareness among counselors so that they might better serve their clients. Given the sizable population that may legitimately need HECMs, it is important to improve awareness and provide training to detect fraudulent schemes and prevent this type of deception from occurring.
Keywords
Acknowledgements
The authors would like to thank the Georgia Real Estate Fraud Prevention and Awareness Coalition (GREFPAC) for providing financial assistance that helped make this research possible. GREFPAC played no role in the research design of this work or in the submission process of this manuscript.
Citation
C. Seay, M., T. Carswell, A., Wilmarth, M. and G. Zimmerman, L. (2014), "Exploring HECM counselors’ fraud awareness and training", Journal of Financial Crime, Vol. 21 No. 4, pp. 484-494. https://doi.org/10.1108/JFC-03-2013-0020
Publisher
:Emerald Group Publishing Limited
Copyright © 2014, Emerald Group Publishing Limited